Page last updated at 15:57 GMT, Monday, 10 December 2012

Minister: 'bankers in different world'

A government minister has criticised bankers, saying they live "in a different world to the rest of us".

Treasury spokesman Lord Newby was speaking during oral questions on 10 December 2012.

Lord Barnett asked what action the government was taking to regulate the banking industry, pointing out that the Governor of the Bank of England, Sir Mervyn King, had urged banks to increase their capital reserves immediately.

But responding on behalf of the government, Lord Newby said the comments were "aspirations" of the governor, and that real regulation would only be guaranteed by the setting up Financial Policy Committee under the Financial Services Bill, which is currently going through Parliament.

He told peers: "I'm sure that they [the Financial Policy Committee] will reflect on Lord Barnett's views and will be applying them very shortly."

Lord Newby went on to say that "bankers live in a different world to the rest of us" when asked by Liberal Democrat peer Lord Sharkey if there was anything the government could do about that fact no banker had been charged over the mis-selling of pensions, endowments and Payment Protection Insurance (PPI) over the last five years.

Lord Newby added that bankers who are found to have acted illegally over the manipulation of the bank lending rate LIBOR will face prosecution under the terms of the Financial Services Bill.

Peers also asked questions to the government on the budget allocated to infrastructure for cycling, the effect on the UK economy of the outcomes of the "fiscal cliff" discussions in the USA, and the numerical strengths of the medical services of the Royal Navy, Army and the Royal Air Force.

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